[DeathWolf]

if you mean the "blueish/redish horizontal stroke", it's a lensflare, a typical one: an anamorphic blue/red. Originally it was a consequence of anamorphic lenses but it has become a very common special effect to give a FILM look. ^^
Any decent lensflare plugin(i think even the integrated one might have it) has it.

As for karas:
(this is personal but here's my advice)
-Dont fill in the screen with crap, try to be as "well-merged" as you can.
-Dont use flashy effects such as sudden size changes.
-Try to add transitions.
-If possible try to match the bg colors, else find neutral tones.
-Be readable, a karaoke is meant to be read, not "watched", that means no funky "appearing kara"
-Continuing the previous line: use readable fonts, that means no ultra thin serifs, and no symbollic/runic fonts, these are horrible
-Very important: animated bitmap looks ugly 99% of the time, avoid it unless you really have something good.
-As shinji said, dont cascade effects too much, more than 2 effects will probably already be overkill for a single syllab
-Moving kara can be hard to read so try to keep it in a relatively fixed location
-Try to avoid overlapping bluntly with the original credits


Now as for technical tricks:
You can mix both ssa and afx for nice effects, although with a good import script(like shinji's), it might make less sense.

@shinji:
with your script there's a way not to have to remove spaces all the time, just edit the font, make space's width 0,
and in the ssa/ass replace all real spaces by unicode spaces of another kind, it works pretty well(I usually use the japanese fullwidth space)